2008: Timeshare’s Tipping Point?

Depending on what history you accept, timeshare will be celebrating its 40th anniversary next year. And I will be celebrating my ninth year in the industry.

The facts and figures on timeshare show continued upward movement in both the number of people who own and the amount of money generated. At first glance, it appears that the industry is thriving–and compared to the numbers in 1968, it is.

However, you only have to look past the numbers and speak to “the man on the street” to find that things are not as rosy as they could be. According to a recent survey of active leisure travelers in America, an astonishing 94% reported that they were not interested in purchasing a timeshare within the next two years. Ninety-four percent!

Unfortunately, the survey does not ask why such a large number of active leisure travelers are not interested in purchasing a timeshare. Anyone familiar with timeshare can tell you that timeshare ownership has any number of benefits, including:

• saving money on vacations
• more choices of vacation experiences
• higher quality vacation accommodations
• lifetime ownership

I suspect the people who reported that they were not interested in purchasing were, in reality, not interested in purchasing a timeshare by means of a 3-hour sales presentation.

It is my privilege to teach university students each year. The majority of the students enrolled in a timeshare class have a negative or neutral view on timeshare at the start of the semester. At the end of each semester, I ask them if their views have changed.

Not surprisingly, more than 87% of them say that their view of the timeshare product has improved, many to the point of asking me what is the best way to purchase a timeshare.

At the end of each semester, I ask this question: “If you could change one thing about the timeshare industry, what would it be and why?”

An overwhelming number of them (96%) say that they would change the way timeshares are marketed and sold.

I thought I would share some of their comments:
“Timeshares should be striving to create products that consumers actually wish to pursue rather than get pulled into something because of a gift.”

“I would change the way the companies recruit tours. I think it is tacky and horrible the way they set up booths outside of gas stations and in malls.”

“Change it to market more only to the people that can afford it. Less money to be spent/wasted on mini-vacs or hooks to people who could never afford it.”

“I would change the sales and marketing aspect. I don’t think free gifts should be given. There should be more advertising (TV, magazines, etc.) displaying timeshares in a good light to make customers want to buy instead of having to be bribed to even go to a presentation.”
And my favorite:
“One thing I would change would be the marketing technique. Although ‘free park tickets’ works, I feel it gives a negative, hokey impression. People know what they are getting into with this, but it seems like such a baiting type technique.”
These are college students. Tomorrow’s educated, savvy and critical timeshare prospects. I suspect that if given free rein, they could have a tremendous, positive impact on the timeshare industry.

Until now, the timeshare industry has done a very good job of “same old, same old.” Bribe the client, dazzle them with pretty pictures, tell them what they want to hear, raise the prices to offset extraordinarily high marketing costs, and then rake in the bucks.

As the industry approaches its 40th anniversary, I believe that it sits at a critical tipping point. It is time for positive change, or we run the risk of becoming outdated and left behind.

The good people at Holiday are, thankfully, part of this positive change. They have knowledgeable people on staff to guide consumers through the various timeshare products, an ever-changing inventory of timeshares available for purchase that don’t require a lengthy sales spiel, and they provide vast amounts of timeshare knowledge and information on their website.

My goal for 2008 is to do whatever I can to bring about this positive change. My working with Holiday to provide bigger and better “Timeshare Bootcamps” that were such as success this year will be a critical part of the plan. I’ll also continue to write and be the voice of the timeshare client to the industry where and when I can.

And don’t forget that you, the public, play an important role in all of this. Get educated, speak up, don’t fall for the “same old, same old,” and remember–it’s your vacation . . . get the most out of it!

–Lisa Ann Schreier, The Timeshare Crusader, is the founder of Timeshare Insights (www.timeshareinsights.com) and the author of Surviving A Timeshare Presentation . . . Confessions From The Sales Table, and Timeshare Vacations For Dummies. Ms. Schreier offers a 20% discount on her consulting services to Holiday clients. E-mail her at lisa@timeshareinsights.com for information.

WALLET FRIENDLY: Time shares, condo hotels and home rentals reduce the cost of a visit to Las Vegas

By Beverly Beyette
LOS ANGELES TIMES
LAS VEGAS – When Las Vegas was in its infancy, high-end hotels practically gave away rooms to lure gamblers. Today, travelers can break the bank paying for a few nights’ lodging. But there are alternatives – condo hotels, time shares and vacation-home rentals.
Time shares are as plentiful as slot machines. Besides those already built, several more are under construction. When not occupied by owners, they’re usually available for short-term rental, as are units in condo hotels, another fast-growing segment of the market.

On a recent trip, I stayed at the Platinum, a new condo hotel not far from the Strip, and at Hilton Grand Vacations Club, a time share at the Strip’s north end. A suite – a small apartment really – at the Platinum was $195 a night midweek, including tax; a room with kitchenette at the Hilton averaged $191 a night for three nights including a weekend. [read story]
Don’t forget to check out Holiday’s selection of Las Vegas timeshares, available, as always, at 60% to 80% below retail prices.

The Real Truths About Timeshare

A recent article found floating around the Internet lately, entitled, “The Top Five Reasons Why Timeshares Are A Bad Investment,” has me hopping mad. I am tired of listening to the same old stuff about how timeshares, whether tied to real estate or not, are a poor investment.
If you buy a timeshare, ANY timeshare, as a real estate investment, you do not understand what you are buying. And if you sell a timeshare, ANY timeshare, as a real estate investment, you do not understand what you are selling.

I won’t give the author of the article any more credit; he has done enough disservice as it is. However, I will rebut his points one by one.
1. TIME VALUE OF MONEY

If someone came up to you 10 years ago and offered you a deal whereby for $5,000 you could receive all the gasoline for all the cars you would ever drive, would you consider this a good deal? The answer for most of us would be a resounding “YES.” Back when I started driving, gas was $.74 a gallon. Today, I filled up for $2.65 a gallon.

Timeshare operates on the same premise. You are, in fact, pre-paying for tomorrow’s use at today’s price. If 10 years ago you were offered an opportunity to pay $5,000 for a one-week quality vacation every year forever, wouldn’t you have taken it? If vacations were important to you, then you would have been foolish not to take the offer.
2. MAINTENANCE FEES

Again the author makes these fees out to be specific to timeshare only. Let’s be serious. When you rent a hotel room for $142 a night (the US average according to AAA this year) you are also paying your maintenance fees, unless you are doing landscaping work, cleaning the pool or overhauling the roof. How much of what you are paying is for using the room, and how much is for the maintenance fee? They keep that information from you.

At least with a timeshare, you know upfront what the fees are. Again, shame on anyone who purchases a timeshare without knowing what the fees are, what they were last year, and the year before that and knowing what the cap, if any, is.

If you buy a car today for around $30,000 would you expect to not pay maintenance fees? When you buy a house, don’t you have to pay to keep the place up? Can you rent a hotel room for less than maintenance fees? Of course you can! The average annual timeshare maintenance fee last year was about $550. That comes to about $78 per night. And you’re going to find a hotel room for $78 a night where? Of course, if you are happy with a $78 hotel room, then by all means, stay away from timeshare.

3. A DEPRECIATNG ASSET

Yes, if you purchase from a developer and pay the current average of $15,000, you can turn around in two years and expect to get considerably less than that. But compare that with almost anything else you buy. A car, for instance, that you buy at $30,000 and finance. The second you drive it out of the dealer you take a $5,000 hit at least. Drive it for a year or two and you’re down $10,000. Drive it until you can’t anymore, say 15 years, sell it for $2,000 and then you have to start all over again.

It’s the same thing with furniture, computers, clothing, CDs, electronics and everything else.
Timeshares should NEVER be purchased with an eye for selling them. Timeshares should be purchased with an eye for using them. And unlike the car, the furniture, the computer, the clothing, the CDs, the electronics and everything else, they don’t have a shelf life, they don’t expire, they don’t have to be replaced . . . you just have to pay an annual fee to keep your home resort up to date.

Of course, if you buy a timeshare on the resale market from a reputable organization such as Holiday, you are going to pay considerably LESS than the $15,000 average, so the “depreciating asset” myth is just that, a myth.

4. LOW RENTAL RATES

Yes, you can stay in some timeshares for less than the cost of owning the same timeshare if you don’t purchase from the developer. When you purchase from a legitimate reseller, I can almost guarantee that you will save money over renting.

If you like to rent, then by all means continue to rent. That’s Basic Timeshare 101. But if you like to own your vacation, vacation in nicer places than before, have something to hand down to future generations, have more control over your vacations, timeshare is the way to go.

5. EXCHANGES

No one ever said that using a timeshare was going to be free, did they? While I happen to disagree with the rising exchange rates that both RCI and II charge for a transaction that most owners do themselves, in the long run, those fees don’t add up to that much. And any savvy timeshare owner had better be checking up on the many other timeshare exchange companies that are available. Just because the resort is affiliated with one of the 2 major exchange companies doesn’t mean you have to use them.

The author makes a point of saying that developers are not interested in updating and/or remodeling resorts. That is just not true. Of course, there will always be some unscrupulous developer out there, but it really is up to the consumer to ask questions beyond, “How much does it cost?” And with all the resources out there for consumers, it is a very simple thing to get other owners’ views on a particular resort.

As for the ridiculous statement, “Let’s just hope you don’t buy a timeshare in hurricane country,” again, consumers need to ask good questions about what type of insurance the resort has and the fees associated with it.

In closing, let me reiterate a few points:

• No timeshare, even real estate-based timeshare, should ever be purchased or sold as a real estate investment. As I said in my first book, Surviving A Timeshare Presentation . . . Confessions From The Sales Table: “Timeshare is not Donald Trump-type real estate.”
• It is imperative for consumers to ask a lot of questions before making any purchase. Questions about annual fees, exchange fees, insurance costs, etc. are basic.
• Understand the exchange or trading system, whichever one you are going to be using. An off-season week in Alabama is simply not going to trade for a high-season week in Hilton Head. No matter what the salesperson says, or no matter how much you want to believe it.

For more information, check back with Holiday and Timeshare Insights (www.timeshareinsights.com) frequently. You’re going to be seeing us everywhere in the coming months with our innovative ‘”Timeshare Bootcamps.”

Lisa Ann Schreier, a/k/a “The Timeshare Crusader,” is the founder of Timeshare Insights, a consumer consulting and education service. Ms. Schreier is the author of two best-selling books about timeshare and is a frequent guest and contributor to major media outlets. She was recently featured on Good Morning America and Kiplingers Personal Finance.

Boomer

History may record 2007 as the year Boomer Web sites boomed. (We suspect 2008 will be known as the year many of them busted, but that remains to be seen.)
As a public service, herewith are sites we’ve found that are attempting to woo Boomers online. So as to not sway your opinion, we’re only listing the site name and tagline — no logos.
If you know or hear of one not yet on the list, please let us know. We’ll update the list as needed. [Read More]

Timeshare Scoop Interview: Houseboat Vacation

Our latest Timeshare Scoop winner is Lea Collins, who wrote us about her houseboat timeshare vacation on the St. John’s River. Go here to read Lea’s story, “A Lifetime of Wonderful Excursions!”
Q: What resort did you stay at, and how was the overall experience?
A: We stayed at the Holly Bluff Marina in St. John’s River, in Deland, Florida. The people there are extraordinary. They teach you how to captain the boat, and make your houseboating experience the best it can be.

Q: What did you like most about the houseboats?
A: I love the fact you can be on the river, enjoy nature, and yet have the kitchen right there, the bathroom, and beds for my grandkids to take their naps. We go back to the marina most nights and tie up. My husband loves the fact that we have cable, but we can still fish off the back of the boat in the marina.

Q: Would you recommend a houseboat vacation to others?
A: We seem to be able to relax more on the housboat than other vacations. There is no running here and there to be entertained. We just go out on the front or back deck and enjoy.

Q: How long have you been timesharing, and what made you decide to do it?
A: We bought our first timeshare 10 years ago. We love the beach, so we bought one on Daytona Beach. Later we bought one near Disney World for trading purposes. Funny, we live in Florida, and all of our timeshares are within an hour of each other.

Q: What are your favorite timeshare resorts?
A: We have been to the Banyan Tree Resort and the Sunset Harbor in Key West, Sky Valley in Clayton, Georgia, Club de Soliel in Las Vegas,and Fairfield Bay in Heber Springs, Arkansas. I love Key West. Both of the resorts there were excellent.

Q: What do you most like about timesharing?
A: I don’t like eating every meal out. I love that we have a kitchen, and if we decide we want just a lazy day, we don’t have to go out to eat. We often have company with us, so private sleeping areas are great. When we went to Las Vegas, it was for a convention. While my coworkers each paid $189 a night, my husband and I both stayed at the Club de Soleil for $129.00 for the week.

Q: Have you learned any “tricks” to exchanging?
A: Yes, we found that our Disney timeshare did not quite have the trading power that we thought it would, but if you do last-minute booking, you are more likely to be upgraded because of cancellations and resorts wanting to fill their space.
Do you have a timeshare story? Tell us about your timeshare vacation, recent or past. Share how you and your family or friends use timeshare. If we feature it on our Timeshare Story page, you’ll receive a FREE RCI Week. Visit our Timeshare Story Page for more information.

Guest Article: Looking For Bargains

By Lisa Ann Schreier
Late last month, I had the pleasure of co-hosting a live webinar entitled “Making The Most Out Of Your Timeshare.” It was great fun and I enjoyed the many insightful questions that I received at the end of the presentation.

Soon afterwards, I was playing around at the RCI website and was delighted to see that there were some new additions. Both Last Call and Extra Vacations had a discount attached to them, and many resort exchanges were on sale for as much as 50% off regular point values. Up to 50% off!
Just another example of how it pays to not only keep your exchange company membership valid, but also to check back to the website every now and then, even if you are not planning a vacation in the foreseeable future.

There will always be people who complain about timeshare. Some of those complaints are indeed valid—buying more than you can use, not being able to exchange for prime destinations in prime times, increasing annual dues, etc.

And then there are the success stories. As some of you know, I was a timeshare salesperson for more than 6 years in the Orlando area. I have sold weeks, points, RCI, and Interval International. Back in 2001, two couples from Minnesota purchased an RCI Points-based timeshare. Combined, they own a total of 132,000 points. I recently spoke to them because they were planning another vacation to Orlando. In addition to the timeshare they owned in Orlando, they each bought a week in Hawaii.

This year, each couple was coming down to Orlando for one week and then jetting off to Hawaii for four—yes, four—weeks, each using a combination of their points and their weeks. And while these people are fairly bright, intelligent, motivated owners, they are not magicians.

What they do is carefully plan, check RCI every now and then to see what is available, then take advantage of good deals. Do they pay a lot in annual fees? I’m sure the fees in Hawaii are hefty. But the interesting thing about these two couples is how much they enjoy timesharing and how much they recommend it to their friends and family.

If you enjoy vacationing, want more “bang for your buck,” and purchase the right timeshare for you, I promise you’ll never regret buying a timeshare. Happy vacations to all of you!
Lisa Ann Schreier, aka “The Timeshare Crusader,” is the author of Timeshare Vacations For Dummies, and Surviving a Timeshare Presentation: Confessions From the Sales Table. She is also the founder of Timeshare Insights, an independent consulting firm.

Wyndham Vacation Ownership Begins Construction of Long Beach, Washington Resort

Wyndham Vacation Ownership, the world’s largest vacation ownership company and a member of the Wyndham Worldwide family of companies (NYSE: WYN), today announced it has begun construction of the new 98-unit WorldMark Long Beach resort in Washington. It is anticipated the scenic oceanfront resort will welcome its first guests in the fall of 2008. [read more]

Timeshare vs. Hotel

BY Barbara Correa Staff Writer

Does $18,000 for a week’s vacation for the rest of your life sound good?

That’s the average price paid last year for a time share. Despite that high barrier to entry, the time-share business is booming. But does it make financial sense to buy a piece of home away from home?

Well, in the example above, the cost would work out to about $600 for each week if you had the time share for 30 years.

Like a lot of consumers, I was always skeptical about the concept of paying upfront for a lifetime of guaranteed annual vacations at the same resort. The initial investment is a major turnoff, and the thought of always visiting the same place runs counter to many vacationers’ idea of what travel should be.

But spending a few nights at a relative’s poolside condo in Palm Springs last month convinced me that the time-share model can pay off. [read more]
Timeshare does make sense for over 4,000,000 US owners, a number that is increasing every year. But what makes most sense is buying your timeshare from the resale market. You’ll save from 60% to 80% below retail prices when you purchase from Holiday!

Timeshares and Fractionals: What’s the Difference?

The concept of a timeshare is well-known among second-home owners, but the concept of a fractional – or a private residence club – is demonstrably not. A study this year by the American Affluence Center reported only 33% of their respondents (who averaged a net-worth around $3 million) to be familiar with the more luxurious private residence club concept. So what are they and why compare them with timeshares? [read more]

Should You Buy a Time-Share?

To judge the merits of time-shares, get familiar with the business. You should know that while many are deeded properties, others (especially outside the U.S.) are leases or right-to-use agreements, which don’t give you permanent real estate ownership. Also, vacation weeks come in three flavors: fixed (the same slot every year), floating (you can reserve different times in different years) and point-based. Under point-based systems, which are used by several of the giant hotel companies that operate time-shares, such as Disney, Marriott and Starwood, time-shares have specific values depending on the location of your resort and the time of year you stay. You can use the points to stay at any locale and sometimes for airline tickets or car rentals, too. Also key: The trade value of your property will be determined by whatever time-share exchange company is affiliated with your resort. That firm will handle transactions between your time-share and others around the globe, usually for a fee of about $160 per trade. The two largest are Resort Condominium International, owned by Wyndham Worldwide, and Interval International, owned by InterActiveCorp. For more details on ownership, use and trading, buy Schreier’s book and join the Timeshare Users Group, or TUG (www.tug2.net; $15 a year).
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